Should I swap to a green energy tariff?

March 18, 2015

We gets lots of requests from our users about energy suppliers – questions like which supplier is the cheapest, who provides the best customer service and which of the suppliers are Green Deal participants.

One question that seems to be getting a lot of airtime at the minute is whether it is worth swapping to a Green / Renewable Energy tariff.

Unfortunately this is not as simple a question as it may first appear.

Firstly we need to clear up a really common misconception.

People often assume that if you pay for one of these tariffs you are getting a direct power line straight into your home from the closest wind turbine or solar PV farm. This is not the case – any electricity (unless you make it yourself) will be delivered to your home via the National Grid.

The electricity provided to you comes from a whole mix of sources, coal, natural gas, nuclear and renewables all play their part. The actual source of the electricity that gets delivered to your home is entirely dependent on where you live.

If you live 5 miles from a nuclear power plant, your home is going to be running on electricity produced from that plant. Likewise, if you live near an offshore wind farm, then chances are that is providing all your electricity. Hopefully you get the idea – it is all based on your location and what electricity generation capacity is near to you.

In fact, by paying for a green energy tariff, all you are doing is paying for a commitment by your supplier to put green energy into the grid. The green energy suppliers do this by buying renewable energy from the power providers or installing their own capacity.

The only way you can be truly ‘green’ is to install your own electricity generation systems like Solar PV as well as sufficient energy storage to get through any intermittency issue (e.g. when the sun doesn’t shine at night).

So bearing this in mind – why then should you opt for a green tariff?

There are a few reasons in our opinion.

Green energy companies potentially offer better customer service

Firstly, the greener energy suppliers tend to be the smaller companies, so you can almost guarantee better customer service. Which? recently carried out a customer satisfaction survey on all energy suppliers in the UK. The Big Six occupied 6 of the lowest 7 places in the rankings. The reason in our opinion is that they are simply too big to care – they have millions of customers so treat each one as a number.

The smaller energy suppliers work harder to retain customers and the best way of doing this is great customer service – hence going with a green energy supplier should ensure you get through to someone on the other end of the phone who can actually help you with your issue!

Supporting a more environmentally friendly energy mix

While you yourself might not be watching a TV powered by a wind turbine, paying for the environmental tariff does ensure that the UK does incorporate more and more renewables into the energy generation mix.

With coal plants being switched off due to high emission levels and nuclear power plants all reaching the end of their lives towards the end of the decade, we are going to see step changes (downwards) in our electricity generation. Renewables are much quicker to install than the more traditional power plants – a nuclear power plant can take as long as 15 years to install from initial planning through to it actually producing power. A solar farm can be installed in a matter of weeks.

While the UK will certainly be producing less electricity in the years to come due to increased energy efficiency (which will support a reduction in energy demand), it is comforting to know that as new capacity is added, the bulk of it will be from renewables.

Green energy companies can offer cheaper tariffs!

At the start of this, we mentioned that one of the most common requests we get is ‘which energy supplier is the cheapest’. For most people the price is the biggest factor in pushing them towards a particular tariff – you can see this simply due to the rise in comparison sites that now are up and running.

The great news is that some green tariffs are just as cheap as the more traditional tariffs, so why wouldn’t you opt for one of them? Companies like Ecotricity, LoCo2Energy and Good Energy all offer really competitive rates – so it is worth checking them out.

So while opting for a green tariff doesn’t guarantee that you are receiving electricity from a renewable source, in our opinion it is still very much worth considering especially if you can get it at a similar price to the other tariffs. After all, if everyone where to go this route and swap to greener tariffs, the impact on the energy mix would be hugely significant – then maybe your home would be powered purely by the sun!